SBD/Issue 13/Franchises

Reports Say Expos’ Move To DC To Become Official Today

MLB will announce at an afternoon press conference that the Expos will move to DC for the ’05 season, according to multiple reports today. The team will play three seasons at RFK Stadium before moving into a new $440 ballpark near the Anacostia River (Mult., 9/29). In DC, Thomas Heath reports that a three-pronged agreement to appease Orioles Owner Peter Angelos includes an Orioles/Expos RSN; MLB agreeing to make up for any revenue shortfall the Orioles might suffer because of the new team; and MLB guaranteeing that the Orioles’ value “will not decline below a certain level in the event of a sale.” Sources said that MLB “would make up the difference” if the revenue or franchise value falls below the set thresholds. Angelos “reportedly wants the financial guarantees to be effective indefinitely, while baseball wants the guarantees to last only as long as Angelos owns the team” (WASHINGTON POST, 9/29). ESPN.com’s Jayson Stark cited a source as saying that while MLB and Angelos have not reached agreement “on all issues, they are now close enough on the parameters of a deal” for MLB to make the announcement (ESPN.com, 9/28).

RSN RAMIFICATIONS: In Baltimore, Morgan & Waldman report one scenario has the Orioles receiving a “disproportionate share of the revenue” from the RSN, “at least for a certain number of years.” But such a move could “reduce the price a buyer would pay for the relocated Expos. ... That would undermine the intent to make as much money as possible on the sale for the 29 other [MLB] owners, and might hurt the franchise’s financial performance down the road” (Baltimore SUN, 9/29). Meanwhile, MULTICHANNEL NEWS’ Mike Reynolds noted that the Orioles are in the third year of a five-year TV rights deal with Comcast Sports Net Mid-Atlantic, and a CSN Mid-Atlantic spokesperson was “unaware of any contact from MLB on the issue” of a new RSN. The spokesperson: “If and when something does happen, I’m sure we’ll sit down with the appropriate parties” (MULTICHANNEL.com, 9/28).

OH MARYLAND, MY MARYLAND: Maryland Stadium Authority (MSA) Exec Dir Alison Asti was “glad to hear Angelos and [MLB President & COO Bob] DuPuy acknowledge the public’s stake in the outcome of the negotiations.” The SUN’s Waldman & Morgan note that because the Orioles pay rent based on a percentage of their revenues, the MSA “could also suffer from any financial harm the Orioles might incur.” Angelos said that he “has been in touch with” Maryland Gov. Robert Ehrlich Jr., adding, “I want to protect the city and its well-being. I want to protect the state’s investment. And, if we do that, we’ll protect the Orioles franchise” (Baltimore SUN, 9/29).

WORKING ON A BUILDING: The AP’s Joseph White cited a source as saying that MLB has “produced a 30-page document that would conditionally award” the Expos to DC, pending approval of the new ballpark by the DC City Council. Meanwhile, MLB Marketing Communications Manager Carmine Tiso said that the MLB Rangers, which were the Washington Senators from ’61-71, retain the rights to the name “Washington Senators” (AP, 9/28). In DC, Eric Fisher reports DC officials hope to introduce the ballpark legislation to the DC Council “by the end of the week. The urgent timetable is needed in order to have enough time to ensure passage by the end of the year, as well as leaving enough time to renovate RFK Stadium for baseball” (WASHINGTON TIMES, 9/29).

WHO’S IN CHARGE HERE? In DC, Thom Loverro writes MLB “likely still will make the personnel and roster decisions for the team.” Expos President Tony Tavares “doubts the franchise will be sold to new owners in time to make personnel decisions, such as signing free agents, that are often made in November and December,” saying that it is “possible that a new ownership group might not take over operation of the Expos until May or June.” But Tavares expects payroll to be greater the Expos’ $37M from this season. Tavares: “One of the things we have to negotiate with [MLB] is that we are going to increase our revenues substantially by moving to [DC]. I want to get some kind of relationship going with what my payroll is versus what my revenues are” (WASHINGTON TIMES, 9/29). Meanwhile, in N.Y., Lee Jenkins reports the Mets have reached an agreement to hire Expos GM Omar Minaya as head of baseball operations. Mets GM Jim Duquette “is expected to remain with the organization, but will work under Minaya” (N.Y. TIMES, 9/29).

NO, VIRGINIA, THERE IS NO BASEBALL TEAM: In DC, Laris & Shear report that under a last-minute suggestion by the relocation committee to the Virginia Baseball Stadium Authority (VBSA), the state of Virginia would have given “the hundreds of millions of dollars in tax revenue expected from the ballpark to baseball or team owners, who would then finance the ballpark themselves.” The VBSA “rushed to secure assurances from Attorney General Jerry W. Kilgore that such handouts –- totaling about $1[B] over 30 years in one scenario –- were legal.” Virginia Gov. Mark Warner said of the proposal, “They are taking more of the risk and getting more of the upside. That’s business. My responsibility was to guard the fiscal situation for the taxpayers.” But VBSA sources said that the plan “appears to have foundered,” and efforts to “sweeten the deal by adding sources of revenue” also failed (WASHINGTON POST, 9/29).

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